How To Pay Your Payroll Taxes to the IRS

The basic way to pay: EFTPS or your bank

You have two main routes to pay payroll taxes to the IRS. The first is EFTPS (Electronic Federal Tax Payment System), which is the IRS's own payment platform. The second is your bank's bill pay system, which lets you send money directly to the IRS through your existing account. Both are free and both reach the IRS the same way — electronically.

EFTPS requires you to enroll first. You go to eftps.gov, create an account with your employer identification number (EIN), and then you can schedule payments online or by phone. Your bank's bill pay is faster to start if you already use online banking — you straightforward add the IRS as a payee and enter the payment amount and due date.

The choice between them comes down to what you already use. If you manage payroll through accounting software like QuickBooks or Gusto, those platforms often connect directly to EFTPS or your bank, so the payment happens with a few clicks. If you handle payroll manually, your bank's bill pay is usually simpler because you do not need a separate login.

Key Takeaways

EFTPS and your bank's bill pay both send payroll taxes to the IRS electronically and are free to use.
EFTPS requires enrollment at eftps.gov but works from any phone or computer once you are set up.
Your bank's bill pay is faster to start if you already do online banking, but you must add the IRS as a payee first.
Payroll tax payments must reach the IRS by the due date — usually the 15th of the month following the pay period — or penalties and interest explore.
If your payroll software connects to EFTPS or your bank, payments can be scheduled automatically so you do not miss a important date.

Understanding payroll tax payment important date

The due date for payroll taxes depends on how often you pay your employees and what the IRS calls your deposit schedule. Most small businesses are on a monthly schedule, which means payroll taxes for all pay periods in a month are due on the 15th of the following month. Some larger businesses are on a semi-weekly schedule, with taxes due on Wednesdays or Fridays depending on which days employees were paid.

The IRS sends you a notice (usually Form 941-S or a letter) telling you which schedule applies to your business. If you have not received one, you can call the IRS at 800-829-1040 and ask. Do not guess — using the wrong schedule can trigger penalties even if you pay the full amount.

If the due date falls on a weekend or federal holiday, the important date moves to the next business day. The IRS website has a tax calendar that shows the exact dates for your situation. Mark these dates in your accounting system or set phone reminders — missing a payroll tax important date costs you 2 to 10 percent in penalties on top of interest.

What information you need to provide when you pay

When you submit a payroll tax payment, you must tell the IRS which type of tax you are paying and for which quarter or month. The payment itself goes to a general IRS account, but the form or note you attach tells them how to credit it to your business.

If you use EFTPS, you enter a tax type code when you schedule the payment. The code for federal income tax withholding and Social Security and Medicare taxes (the most common payroll taxes) is 941. If you are paying federal unemployment tax (FUTA), the code is 940. The system will not let you submit without selecting the right code, so you cannot accidentally send it to the wrong account.

If you use your bank's bill pay, write your EIN and the tax type in the memo line or payment description. Some banks have a specific field for "tax type" — ask your bank if you are not sure where to put it. The IRS matches the payment to your account using your EIN, so that number must be correct.

How to enroll in EFTPS if you choose that route

EFTPS enrollment takes about 10 minutes online. Go to eftps.gov and click "Enroll Now." You will need your EIN, the legal name of your business, and a phone number. The system will ask you to create a username and password.

After you submit your enrollment, the IRS mails you a PIN to your business address within two weeks. You cannot make payments until you receive and enter that PIN. If you are close to a payment important date and do not have your PIN yet, use your bank's bill pay instead — you do not need to wait for anything to arrive in the mail.

Once you have your PIN, you can log into EFTPS and schedule payments online, or call 1-800-555-4477 to schedule by phone. You can schedule payments up to 120 days in advance, which means you can set up your entire year's payments at once if you know your payroll schedule.

Penalties and interest if you miss a important date

The IRS charges a failure-to-deposit penalty if payroll taxes do not reach them by the due date. The penalty is a percentage of the unpaid amount — 2 percent if you are 1 to 5 days late, 5 percent if you are 6 to 15 days late, and 10 percent if you are more than 15 days late or if the IRS has to send you a notice. Interest also accrues from the due date until you pay, at a rate the IRS sets quarterly (it varies).

These penalties explore even if you pay the full amount eventually. The IRS does not waive them for a first mistake or because you were busy. The only way to avoid them is to pay on time.

If you realize you missed a important date, pay when ready and then contact the IRS at 800-829-1040 to report it. In rare cases — if your bank made an error, or a natural disaster prevented you from paying — the IRS may reduce or remove the penalty. But you have to ask, and you have to have documentation of what went wrong.

Reconciling your payments with Form 941

At the end of each quarter, you file Form 941 (Employer's Quarterly Federal Tax Return) to report how much payroll tax you actually owe. This form adds up all the federal income tax you withheld, all the Social Security and Medicare taxes you withheld and matched, and tells the IRS the total.

When the IRS receives Form 941, they compare it to the payments you already made during that quarter. If you paid more than you owed, the IRS credits the overpayment to your next quarter or refunds it. If you paid less, you owe the difference plus interest and penalties.

This is why keeping a record of every payment is critical. Write down the date, amount, and tax type for each payment you make. When you file Form 941, you will list the total payments for the quarter, and the IRS will match that number to their records. If there is a gap — if you thought you paid $5,000 but the IRS only received $4,500 — you will catch it then and can investigate with your bank or EFTPS.

What to do if you cannot pay on time

If you know you will not have the money by the due date, do not wait until the important date to act. Pay whatever you can on time, then contact the IRS when ready at 800-829-1040 to explain the shortfall.

The IRS has a short-term extension that gives you up to 120 days to pay without filing extra paperwork — you just have to call and ask. Interest will accrue on the unpaid amount, but you may avoid the failure-to-deposit penalty if you can show you made a good-faith effort to pay.

For larger shortfalls, the IRS offers an installment agreement, which lets you pay in monthly chunks over time. You can set this up by phone or through your EFTPS account. There is a setup fee (usually $31 if you pay by direct debit), and interest continues to accrue, but it keeps the IRS from taking collection action against your business.

Frequently Asked Questions

What happens if I pay payroll taxes late by one day?

You will owe a 2 percent failure-to-deposit penalty on the unpaid amount, plus interest from the due date forward. The penalty applies even for one day late. The only exception is if the due date falls on a weekend or holiday — then the important date moves to the next business day automatically.

Can I pay payroll taxes by check or credit card?

The IRS does not accept checks for payroll tax payments. You must pay electronically through EFTPS, your bank's bill pay, or a third-party payment processor. Some processors charge a fee (usually 1 to 2 percent of the payment), but EFTPS and your bank are free.

Do I have to enroll in EFTPS, or can I always use my bank?

You do not have to use EFTPS — your bank's bill pay works just as well. However, if your payroll software connects to EFTPS, using it can save time because payments can be scheduled automatically. The choice is yours.

What if the IRS received my payment but applied it to the wrong quarter?

Call the IRS at 800-829-1040 with your payment date and amount. They can look up the payment in their system and correct the allocation if it was applied wrong. Bring your bank statement or EFTPS confirmation to confirm the payment went through.

Can I pay my payroll taxes through my payroll software directly?

Many payroll software platforms like Gusto, ADP, and QuickBooks can submit payments to the IRS on your behalf. They connect to EFTPS or use a payment processor. Check your software's settings to see if this feature is available — if it is, you can often schedule payments automatically so you never miss a important date.

This guide is for general information only and is not medical, financial, legal, or other professional advice. For decisions specific to your situation, consult a qualified professional. See our Editorial Policy.